Thread Request: Bonds

[arclops]

---

Since we already have threads about stocks and mutual funds, i think it's also beneficial to start a thread about bonds. The objective is awareness for those potential investors who might be interested in this investment instrument. If anybody here can share their knowledge and start a thread about bonds, I would personally appreciate it. This covers Retail Treasury Bonds(RTB), Corporate bonds, and other government bonds.

[mudskipper77]

good idea...up ko ani,

[nodols3]

Been monitoring this thread..

Bureau of the Treasury Website

I personally haven't bought Government Securities (GS) yet, but I will be once the goverment releases it this month or next as what it says on the BTr's website.

I did go to BPI and BDO for inquiries about T-bonds, T-bills and Retail Treasury Bills (RTBs).
From BPI I talked with the manager, good thing he a previous acquaintance, unfortunately he said he personally doesn't know much about bonds and RTBs because eventhough he is working for BPI it is not covered in their branch, he said some things about another branch or office of BPI deals with GS's specifically. If I recall it is BPI Capital who's dealing with these kinds of transactions. I showed genuine interest about it so eventually he said, he will be informing me through email or phone when it is ready and I have to sign some forms and he made some side comments about how difficult it is for these transactions, perhaps because it is not in there work scope.. hmmm..

Feeling somewhat unsatisfied about this I went to BDO and ask the teller. Maybe she was new or it was her first time about such inquiry for she was kind of confuse and ask another teller about it and they eventually asked there manager.
The manager told me that their BDO treasury department is the one handling such transactions and she didn't have the authority to do so with me, so she called a nice lady on the phone had a chit chat for a while and eventually transferred the phone to me.

This nice lady inform me that such transactions are controlled, hmm.. I somewhat recalled an article that I've previously read that the government had some restrictions about who's going to buy this GSs, they don't want it going to the wrong hands. I can't say much about this since don't have much experience about it.

She then asked for my phone number and gave hers too, unfortunately I forgot to take note of here number and totally forgot about it.

I asked here if I could buy bonds, T-bonds to be exact. Then she said that the government hasn't release new bonds yet and they are still waiting and she would be glad to inform me if there is already. I asked her if there is a market for bonds which I could readily buy from she said there is. However if I was to buy now I would be buying from a secondary market which of course is more pricey this is because this bonds had already gained and accumulated interest on them and it is bought on the secondary market.

To my knowledge correct me if I’m wrong, the process goes like this.

Government issues bonds for bidding  Bidder’s bid ((Primary Market)Banks like BDO, BPI and others as long as they are accrideted by the government)  Banks sell to the public (Secondary Market).

Since the government hasn’t issued bonds yet the ready market is only the secondary market and of couse you will be buying it above par (1par = 100php).

With my ignorance about this she was kind enough to inform me it is much better to wait until the government issues these bonds so I can buy from the bank at a price at par.

Additional information.
If I’d buy T-bills and/or T-bonds from (BDO), initial investment would be 100k, the additional buying would cost at an increment of 1,000. hmmm maybe this goes to say that if I had an existing 100k in bonds at an investment account with them (BDO), I can readily by at 1k only.

Fortunately if you don’t have that much money like I do, we can opt to buy RTBs. For RTBs my friend in BPI said they don’t have this program yet as of now. I think only BDO has this.
For RTBs you can buy it at a minimum of 5k , succeeding investment is also 5k, unlike the T-bills and T-bonds, which you can buy at 1k only.

Hmm.. I think taas na siya kayo nya maboringan namo ani,.

I hope this helps and I hope madatu nata.. hehe


“Dictated, but not read”..

[arclops]

Been monitoring this thread..

Bureau of the Treasury Website

I personally haven't bought Government Securities (GS) yet, but I will be once the goverment releases it this month or next as what it says on the BTr's website.

I did go to BPI and BDO for inquiries about T-bonds, T-bills and Retail Treasury Bills (RTBs).
From BPI I talked with the manager, good thing he a previous acquaintance, unfortunately he said he personally doesn't know much about bonds and RTBs because eventhough he is working for BPI it is not covered in their branch, he said some things about another branch or office of BPI deals with GS's specifically. If I recall it is BPI Capital who's dealing with these kinds of transactions. I showed genuine interest about it so eventually he said, he will be informing me through email or phone when it is ready and I have to sign some forms and he made some side comments about how difficult it is for these transactions, perhaps because it is not in there work scope.. hmmm..

Feeling somewhat unsatisfied about this I went to BDO and ask the teller. Maybe she was new or it was her first time about such inquiry for she was kind of confuse and ask another teller about it and they eventually asked there manager.
The manager told me that their BDO treasury department is the one handling such transactions and she didn't have the authority to do so with me, so she called a nice lady on the phone had a chit chat for a while and eventually transferred the phone to me.

This nice lady inform me that such transactions are controlled, hmm.. I somewhat recalled an article that I've previously read that the government had some restrictions about who's going to buy this GSs, they don't want it going to the wrong hands. I can't say much about this since don't have much experience about it.

She then asked for my phone number and gave hers too, unfortunately I forgot to take note of here number and totally forgot about it.

I asked here if I could buy bonds, T-bonds to be exact. Then she said that the government hasn't release new bonds yet and they are still waiting and she would be glad to inform me if there is already. I asked her if there is a market for bonds which I could readily buy from she said there is. However if I was to buy now I would be buying from a secondary market which of course is more pricey this is because this bonds had already gained and accumulated interest on them and it is bought on the secondary market.

To my knowledge correct me if I’m wrong, the process goes like this.

Government issues bonds for bidding  Bidder’s bid ((Primary Market)Banks like BDO, BPI and others as long as they are accrideted by the government)  Banks sell to the public (Secondary Market).

Since the government hasn’t issued bonds yet the ready market is only the secondary market and of couse you will be buying it above par (1par = 100php).

With my ignorance about this she was kind enough to inform me it is much better to wait until the government issues these bonds so I can buy from the bank at a price at par.

Additional information.
If I’d buy T-bills and/or T-bonds from (BDO), initial investment would be 100k, the additional buying would cost at an increment of 1,000. hmmm maybe this goes to say that if I had an existing 100k in bonds at an investment account with them (BDO), I can readily by at 1k only.

Fortunately if you don’t have that much money like I do, we can opt to buy RTBs. For RTBs my friend in BPI said they don’t have this program yet as of now. I think only BDO has this.
For RTBs you can buy it at a minimum of 5k , succeeding investment is also 5k, unlike the T-bills and T-bonds, which you can buy at 1k only.

Hmm.. I think taas na siya kayo nya maboringan namo ani,.

I hope this helps and I hope madatu nata.. hehe


“Dictated, but not read”..

You're having difficulties maybe because you are asking the wrong question Bro. You should have inquired about RTBs and not T-bonds. The difference between the two is that T-bonds are mostly available to financial institution like banks, while RTBs are retail and offered to the public like us. Bidding is required by the government before T-bonds are issued. While for RTBs, there is a regular schedule sometime in 1st qtr and last qtr and you can buy them at the participating banks....permi ani ang Landbank. I bought RTB last year sa BPI....minimum investment is 5T. For the complete list please check...

http://www.treasury.gov.ph/govsec/ha.../gsed_list.pdf

Other info...

China Banking Corporation [ChinaBank] - Retail Treasury Bonds
BDO Personal Investments & Advisory Services | Government Securities

For the latest news on RTB...

http://www.abs-cbnnews.com/business/...-rtbs-february

[miramax]

@ arclops & nodols3

Thank you guys for that very informative inputs you shared in this thread.
I just have had a conversation with our Compliance Manager on the same subject this morning re Gov't bonds.
I have to admit that I am not literate on how the Trust Fund Services-Bonds works.
Considering the rates and risks issue, I am a bit skeptic on investing my money on this type of Financial investment product.

But this time, I might reconsider indulging myself buying RTB's on my next trip to Cebu.

[arclops]

@ arclops & nodols3

Thank you guys for that very informative inputs you shared in this thread.
I just have had a conversation with our Compliance Manager on the same subject this morning re Gov't bonds.
I have to admit that I am not literate on how the Trust Fund Services-Bonds to be exact works.
Considering the rates and risks issue, I am a bit skeptic on investing my money on this type of Financial investment product.

But this time, I might reconsider indulging myself buying RTB's on my next trip to Cebu.

I think you're referring to Unit Investment Trust Fund or UITF. Same principle as mutual fund but bank lang ang nag manage. Like the mutual fund, UITF may have equity fund(100% stocks), balance fund(50% stocks; 50% bonds), and bond fund(100% bond)...ug naa pay money market fund...

From the latest news, RTB will most likely be offered in February. But since BSP is cutting rates now, expect a decline in the coupon rate for that offer. If you are a conservative to moderate type of investor, then consider bonds in your portfolio.

[nodols3]

You're having difficulties maybe because you are asking the wrong question Bro. You should have inquired about RTBs and not T-bonds. The difference between the two is that T-bonds are mostly available to financial institution like banks, while RTBs are retail and offered to the public like us. Bidding is required by the government before T-bonds are issued. While for RTBs, there is a regular schedule sometime in 1st qtr and last qtr and you can buy them at the participating banks....permi ani ang Landbank. I bought RTB last year sa BPI....minimum investment is 5T. For the complete list please check...

http://www.treasury.gov.ph/govsec/ha.../gsed_list.pdf

Other info...

China Banking Corporation [ChinaBank] - Retail Treasury Bonds
BDO Personal Investments & Advisory Services | Government Securities

For the latest news on RTB...

Gov't may issue RTBs in February | ABS-CBN News

Thanks for the info bro.

Mao pud bitaw ako kalibugan sa gisulti sa in-charge sa BDO sa treasury department nila. Naa man gud sa ilang website ni:

BDO Personal Investments & Advisory Services | Government Securities

On the lower most part. naa didto naka butang, and I quote:

"Treasury Bonds

Treasury Bonds are for investors who are willing to place their money in long-term, low-risk instruments. With a minimum investment of only P100,000.00, they enjoy regular coupon interest payments. Plus, the effective yield of the entire investment can also be increased when these interest payments are reinvested in other interesting - earning instruments.

Considered as risk free-investment since these are direct and unconditional obligations by the Philippine government
Minimum investment amount is P100,000.00 (increments of 1,000)
Original investment term is from 2 years to 25 years, depending on availability
Interest payment is semi-annual computed based on the coupon rate
Interest income on the investment is subject to 20% final withholding tax
Investors are required to open a BDO savings or cheking account for automatic crediting of the semi-annual coupon interest payments.
Investment is evidenced by a Confirmation Notice.
BDO, as OTC broker, commits to source the best buy/sell price in the market for its clients.
Clients wishing to buy or sell can get in touch with our various Treasury offices located in Metro Manila and other strategic regional areas. Alternatively, they may also go to any BDO branch which will assist them via referral to a SEC-licensed securities salesman from the Bank.
Can be used as collateral for loans with BDO"

By this I think pwede gyud ta individual investor makapalit ug T-bonds. Anyway nawala man ako gana na nuon. Mas magRTB nalang tingale ko, though murag I've read from somewhere nga expected ang rates karon Feb. mas ubos daw kay sa sa last time nga mga coupon rate. sigh

Anyway will just see. ^^

[arclops]

Thanks for the info bro.

Mao pud bitaw ako kalibugan sa gisulti sa in-charge sa BDO sa treasury department nila. Naa man gud sa ilang website ni:

BDO Personal Investments & Advisory Services | Government Securities

On the lower most part. naa didto naka butang, and I quote:

"Treasury Bonds

Treasury Bonds are for investors who are willing to place their money in long-term, low-risk instruments. With a minimum investment of only P100,000.00, they enjoy regular coupon interest payments. Plus, the effective yield of the entire investment can also be increased when these interest payments are reinvested in other interesting - earning instruments.

Considered as risk free-investment since these are direct and unconditional obligations by the Philippine government
Minimum investment amount is P100,000.00 (increments of 1,000)
Original investment term is from 2 years to 25 years, depending on availability
Interest payment is semi-annual computed based on the coupon rate
Interest income on the investment is subject to 20% final withholding tax
Investors are required to open a BDO savings or cheking account for automatic crediting of the semi-annual coupon interest payments.
Investment is evidenced by a Confirmation Notice.
BDO, as OTC broker, commits to source the best buy/sell price in the market for its clients.
Clients wishing to buy or sell can get in touch with our various Treasury offices located in Metro Manila and other strategic regional areas. Alternatively, they may also go to any BDO branch which will assist them via referral to a SEC-licensed securities salesman from the Bank.
Can be used as collateral for loans with BDO"

By this I think pwede gyud ta individual investor makapalit ug T-bonds. Anyway nawala man ako gana na nuon. Mas magRTB nalang tingale ko, though murag I've read from somewhere nga expected ang rates karon Feb. mas ubos daw kay sa sa last time nga mga coupon rate. sigh

Anyway will just see. ^^

Wala pakoy nailhan nga retail investor nga nakapalit ug Treasury Bond....

[miramax]

I think you're referring to Unit Investment Trust Fund or UITF. Same principle as mutual fund but bank lang ang nag manage. Like the mutual fund, UITF may have equity fund(100% stocks), balance fund(50% stocks; 50% bonds), and bond fund(100% bond)...ug naa pay money market fund...

From the latest news, RTB will most likely be offered in February. But since BSP is cutting rates now, expect a decline in the coupon rate for that offer. If you are a conservative to moderate type of investor, then consider bonds in your portfolio.

YEs bro, I am referring to that UITF. One of our kabayans here shared that they have invested into this so-called "Balanced Fund" in BDO. Morag baya sad ko ug na-attract but again, I am a bit reluctant whether I will also try that product or not given the fact that I don't understand the mechanics.

If I were to purchase RTB's, I will just walk into any branch of those banks that you recommend (BDO,Chinabank) and address to the manager my requirement?
Requoting your statement bro

" But since BSP is cutting rates now, expect a decline in the coupon rate for that offer. If you are a conservative to moderate type of investor, then consider bonds in your portfolio .

Can you please explain this further in layman's term? (pls.bear with me, cos I am not familiar with bank terminologies)

Thanks

[nodols3]

@miramax
Sis, since naa paman ka sa gawas karon pwede ka mo basa usa ani... try checking this link.

BDO Personal Investments & Advisory Services | Government Securities

Naa diri ang RTB ug T-bills and T-bonds.

As for UITF, diretso raka ana sa branch example BDO or BPI, then inquire lang anang UITF to one of the manager. Pwede ra pud ka sa cashier mag ask i direct raman ka ana nila adto sa manager nila.

Same rani as per sa akong inquiry, both BDO and BPI. Basta:

Government Securities like - T-bills, T-bonds and Retail Treasury Bonds (RTB) - Different department sa bank ang mohandle ani, as for BDO ang treasury department ang mohandle ani, that is why if mag inquire ka sa branch manager, basta taronga lang ug sulti nga RTB or T-bonds ang imong ganahan i investan. I-direct ka ana nila sa ilang treasury department. if I recall sa BDO gi direct ko nila kang Ms. Joy , siya ang in-charge ani.
Then sa BPI different department gihapon, so if mag ask ka sa manager sa branch mo ingon na sila nga dili na ilang product, lahi daw nga bank sa BPI, murag BPI Asset Management man tingale to. Dili ang BPI saving or other BPI.

Their no other substitute to experience, diretso-a nalang ang bank sis. They would be glad to help you with your inquiries. ^_^


Hope this helps.. sis.. ^^